Clarkson Chivas, Inc., was started on July 1, 2010. The company is authorized to issue 200,000 shares

Question:

Clarkson Chivas, Inc., was started on July 1, 2010. The company is authorized to issue 200,000 shares of 6%, $110 par value preferred stock, and 1,500,000 shares of common stock with a par value of $1 per share. The following stock transactions took place during the fiscal year ended June 30, 2011:

July 15 ....Issued 10,000 shares of common stock for cash at $2 per share

October 1..Issued 5,000 shares of preferred stock for cash at $115 per share

January 12 ..Issued 15,000 shares of common stock for cash at $4 per share

March 10 ...Issued 7,500 shares of preferred stock for cash at $120 per share

June 1 ....Issued 25,000 shares of common stock for cash at $6 per share

Requirements

1. Show each transaction in the accounting equation.

2. Prepare the contributed capital portion of the shareholders’ equity section of the balance sheet at June 30,2011.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...